Johannesburg, SA’s richest metro saddled with huge service delivery challenges, has tabled a R77.3bn budget aimed mostly at fixing broken infrastructure, with the metro’s power and water utilities getting the biggest slice of the pie.
The municipality, which contributes about 40% of the economy of Gauteng, is dogged by countless challenges, including the ageing electricity and road infrastructure, the supply of housing and water, hijacked buildings, cable theft and rampant violent crime.
The heavy toll of years of bureaucratic cock-ups, neglect, crime and corruption on SA’s economic hub reflects a wider malaise afflicting the country’s municipalities, which lack qualified engineers and financial accountants to build schools, roads and toilets, and manage billions of rand in budgets.
While the City of Johannesburg’s budget has been increasing over the years, with an allocation of R68.1bn for 2020/2021 and R73.3bn for 2021/2022, the metro is faced with a 40% unemployment rate and a poverty rate of 52%, while nearly a third of households are without access to electricity.
In the budget tabled by finance MMC Julie Suddaby on Wednesday, City Power was allocated an operational budget of R20.5bn, of which R1.6bn is earmarked for a reduction of power outages. The power distribution utility was also allocated capital expenditure of R1.2bn to fund infrastructure upgrades and refurbishments.
City Power recorded 1,770 cases of cable theft and vandalism in the current financial year, costing it about R23m in direct losses.
Joburg Water was allocated an operational budget of R13.9bn (R13.4bn in 2021), while Pikitup received R3.5bn to “clean up our city”, compared with the R3.4bn budget and R179.7m for capital spending in 2021.
The Joburg Tourism Company was allocated R79m to help attract 1.5-million people to visit the metro in the coming financial year.
The finance MMC said that to further the quality of care in clinics, the metro had allocated R21.5m to “fully implement the eHealth system over the medium term”.
Road infrastructure initiatives received a capital expenditure budget of R1.1bn, water supply and sewer infrastructure R930m, and sports and recreational facilities R89m.
The metro has prioritised R1.9bn in operating expenditure to the housing department for the upgrading of informal settlements in Meriting, Diepsloot, Zandspruit and Poortjie; and refurbishment of old-age homes in Ivarna, Reuven, Northam Place and Market Street. Community development initiatives were allocated R1.4bn.
The finance MMC said R200m in capital expenditure was allocated to acquire 20 fire engines to be delivered in June 2023, while R1.3m was set aside to employ 150 park rangers to make the city’s parks safer.
“We have allocated R6.1bn in operational budget towards public safety, making it the fourth-largest allocation in this year’s budget, clearly showing that we take crime prevention seriously and that we are fiercely dedicated to having criminals brought to book,” Suddaby said.
“The city will be conducting 1,200 bylaw enforcement operations, 6,400 traffic enforcement operations, and 400 drug search-and-seizure operations.”
Suddaby said revenue collection increased steadily, with R3.6bn collected in January, R4.1bn in February and R4.2bn in March, “adding to R11.9bn which is an increase of R1.6bn over the same period in the previous financial year.
“Our target is to have a 90% collection rate in the coming financial year. This will go a long way in repairing our city.”
National and provincial government establishments owed the metro about R700m, of which R300m has been collected to date.
The city plans to install 1,000 public lights, facilitate investment and businesses to the value of R35bn, and create 17,504 extended public works programme work opportunities.
Property rates will increase 4.85% from July 1, the electricity tariff 7.47%, water tariff 9.75%, and the sanitation and refuse tariffs will increase 9.75% and 5%, respectively. The Reserve Bank forecasts a headline inflation rate of 5.9% for 2022.
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